Reading is alive and increasingly electronic

2011-12-12 00:00

TIMES may be tough for bookstores, but people are reading more than ever and e-books are nurturing bookworms who hunger for everything from blockbuster biographies to literary fiction.

“It’s really been all good news this year. Reading is becoming more popular in general,’’ said Chris Schluep, senior books

editor at Amazon, the biggest online bookseller in the United States.

“It’s so easy to buy a book now,’’ said Schluep. “We’re seeing reading grow across the population.’’

Amazon announced in May that between April 1 and

May 19, for every 100 print books Amazon.com has sold, it has also sold 105 Kindle

e-books.

Book publishers have survived the first stage of a digital revolution in better shape than the music industry and are now embracing the shift to e-books in their search for new revenue streams and lower costs.

The industry has been battered this year by a significant shift from physical books to

e-books that has transferred power to Internet retailers led by Amazon and helped put some high-street chains out of

business.

Publishers have fought and won for now a key battle to keep pricing control over their titles, unlike the music industry, which a decade ago allowed

Apple to impose a flat rate of $0,99 on music tracks in its iTunes store.

Penguin and Hachette said this week they are quite optimistic that e-books will help them increase profitability and reach bigger audiences, although they had not yet figured out how to sell digital extras to readers.

“The consumer sort of slightly shrugs his shoulders and says: ‘Well, that’s marvellous but that’s not something I’m going to pay very much for’,” Penguin chief executive John Makinson told the Reuters Global Media Summit.

As an example, he said

Penguin had created an e-book of Jane Austen’s Pride and

Prejudice enhanced with clips from the movie with Keira Knightley, as well as recipes and dance moves from the period, to no avail.

Children have taken more quickly to extra features, especially on touch screens like

Apple’s iPad, he said.

The shift to e-books, which is most advanced in the United States where Amazon catalysed the market with its Kindle device and store four years ago, has already touched off changes to publishers’ business models, distribution systems and costs.

While e-book prices are on

average 20% to 30% lower than those of physical books, they save publishers the cost of storing and moving books around, and reduce the working capital tied up in inventory.

In markets where book prices are not regulated by law, including the U.S. and Britain, this has already made e-books more profitable than print books.

In regulated markets like France and Germany where laws prevent book stores and supermarkets from discounting in an effort to protect local

culture and prevent the book from being a commodity like any other, print books are still more profitable.

In the U.S., e-books account for about 25% of book sales by volume and 20% by revenue. In Britain, the figure is about 10% by volume, while the rest of

Europe and Asia, excluding

Japan, are just getting off the ground.

“We’re just at the beginning of the curve,” Hachette Book Group CEO Arnaud Nourry said.

Publishers have reached a kind of peace for now in their often stormy relationships with Internet giants like Amazon and Google, which were largely responsible for bringing the digital revolution to the world of books.

With Amazon, publishers fought an intense battle over how e-book prices would be set, opposing the Internet retailer’s effort to impose $9,99 as a standard for new titles on the Kindle, Apple iTunes-style.

Ironically, it was only the emergence last year of Apple with its iPad as a counterweight to Amazon that allowed the so-called “Big Six” publishers to win back control of pricing.

In what is a major shift for the industry, the publishers, determined to avoid the mistakes made by the music industry, imposed an “agency model” in which they set their own prices.

The evolution of the book market is still in its early days, however, and issues like piracy are re-emerging as digital booksellers try to replicate features popular with book lovers, such as lending, in the digital world.

Nourry said he would like to find a way for readers to lend each other e-books, but copyright protection is currently more important as the industry’s new business models are still fragile. — Reuters.

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